Rising transport costs boosted Spain’s December inflation quantity, with rising tradition and recreation costs additionally contributing to the determine.
Spain’s year-on-year inflation charge in December 2024 elevated to 2.8%, from 2.4% in November, in line with the Nationwide Statistics Institute (INE). This was consistent with analyst expectations. It was additionally the best determine since July final yr. December was the third consecutive month of progress.
The speed was primarily due to base results, in addition to a rebound in transport costs, which grew 0.6% in December, from -0.1% in November. Tradition and recreation costs elevated to three.2% in December from 2% within the earlier month, primarily due to rising vacationer bundle costs.
Spain’s year-on-year core inflation charge for December got here as much as 2.6%, which was a four-month excessive, in distinction with November’s 2.4%. This was additionally consistent with market expectations. Core inflation doesn’t take vitality and meals costs into consideration on account of their inherent volatility.
Month-on-month inflation got here as much as 0.5% in December, from November’s 0.2% – greater than analyst estimates of 0.4%.
Spanish inflation anticipated to the touch 2.2% in 2025
The European Fee expects Spanish inflation to common about 2.2% in 2025, earlier than dropping to 2% in 2026, consistent with the European Central Financial institution’s goal. It additionally expects Spain’s gross home product (GDP) progress charge to be 2.3% this yr, earlier than falling to 2.1% subsequent yr.
Spanish monetary providers companyCaixaBank additionally expects Spain’s core inflation to the touch 2% this yr – and for 2025 to be a strong one for the nation’s financial system, primarily due to rising personal home demand.
Nevertheless, the corporate highlights that if geopolitical dangers worsen, this may increasingly dampen financial progress. These embrace a tariff struggle between the US and EU, or EU and China, in addition to an escalation of Center Japanese conflicts, which can push up vitality costs.